Last week, the one-week Bitcoin chart printed an extremely bullish sign: the golden cross of the 50-week and 100-week simple moving averages, with the former crossing above the latter. (As an aside, a golden cross is when a short-term moving average crosses over a long-term one to imply bulls have control.)
While this is a decidedly bullish sign in the long term, with this signal preceding the 1,000%+ rally seen between 2016 and the end of 2017, a leading analyst has remarked that Bitcoin is still susceptible to one final downturn before an eventual return to the macro uptrend.
Related Reading: Bitcoin Poised to Collapse Under $5,000? Market Cycle Fractal Suggests So
One More Dump to $5,500?
CryptoBirb, a strong proponent of the positive effects the aforementioned golden cross will have, recently noted that Bitcoin still has the potential to see one final dump to $5,400-$5,600 — 23% lower than the current price of $7,150. This coincides with the long-term 0.786 Fibonacci Retracement level.
He noted that this would corroborate a trend seen in previous market cycles, which saw BTC see a bullish throwback prior to a resumption of a parabolic uptrend.
the golden cross is here for 2020 but it still might dive 5.4-5.6k (0.786 Fib), unless we start closing weekly 8k+
I wouldn't mind cheap ₿₿₿ for Christmas personally
Decembers have almost always provided us with extremes and pivots. U ready for when it comes? pic.twitter.com/XFk6ORaZbH
— Crypto₿irb (@crypto_birb) December 14, 2019
Birb’s suggestion that Bitcoin will see one more drop lower has been corroborated by other analysts.
Cold Blooded Shiller, a popular cryptocurrency trader, noted that Bitcoin is in a “markdown from distribution” near the $13,000-$14,000 top, a markdown contained by a descending channel that has existed since the top of the recent bull run.
As it stands, Bitcoin at $7,400 is in the middle of the channel, seemingly in no man’s land, thus not close to a bottom.
“From a volume perspective, there is nothing to me that screams “THIS IS THE BOTTOM.” For both markdowns and markups we typically expect to see “climactic” volume,” Shiller wrote, trying to accentuate that there are no concrete signs the bottom is in for the Bitcoin market.
The scenario he is expecting can be seen below, which shows that the leading cryptocurrency could return into the low-$5,000s, a range that has been identified by other analysts as a potential macro bottom.
This is what I'd like (and expect to see):
Price coming out of the markdown channel (downside)
Large volume increase (creating an anomaly against prior volume)
That brings us on to the final piece of information we can use in this set up. pic.twitter.com/6zB4TWnzk0
— Cold Blooded Shiller (@ColdBloodShill) December 7, 2019
Macro Bitcoin Uptrend Intact
Despite this, many researchers have claimed that Bitcoin’s macro uptrend remains intact.
He first drew attention to a chart from Deutsche Bank, the 17th largest bank in the world. It was estimated that the number of users of Blockchain Wallet (blockchain.com) could surmount over 200 million — around six times higher than where the sum currently is — by 2030.
Hauge also looked to the fact that the CEO of Bakkt has just become a U.S. Senator, meaning that Bitcoin could get its own cheerleader in Washington.
He also noted that BTC is “actually pretty close to where it should be,” in reference to a model that takes the number of “Bitcoin transactions ever confirmed and use that as an input into a log-scale linear regression model.”
Related Reading: Could Bitcoin Price Press Higher as PlusToken Liquidations Slow?
Featured Image from Shutterstock
The post Bitcoin Price Still Has Potential to Dive to $5,500, Yet Macro Uptrend Still Intact appeared first on NewsBTC.